UPI-ATM cash withdrawal: Know the process and benefits of cash withdrawal using UPI at ATM

Unified Payment Interface (UPI) has revolutionized digital payments in India, offering a seamless and user-friendly experience for transferring money and making merchant payments. One of the standout features of UPI is its QR code scanning capability, which allows users to complete transactions quickly and securely. Recently, UPI has expanded to include ATM cash withdrawals, further enhancing its convenience and accessibility.

The integration of UPI with ATM networks has the potential to significantly alter the digital payment landscape in India. By enabling UPI for customer authorization and transaction settlement at ATMs, this functionality can be extended to all banks and ATM operators, promoting widespread adoption.

This advancement provides a seamless, interoperable experience, allowing users to withdraw cash without a physical card. For instance, a customer with a UPI-linked bank account can visit any ATM, initiate a card-less cash withdrawal using UPI authentication, and receive cash without using a card.

Follow these steps to withdraw cash from an ATM using UPI:

1. Select 'UPI Withdrawal': At a UPI-enabled ATM, choose the 'UPI Withdrawal' option on the screen.
2. Enter Withdrawal Amount: Specify the amount to withdraw. A single-use dynamic QR code will appear on the screen.
3. Scan the QR Code: Open your UPI-enabled app on your phone, select the 'Scan QR code' option, and scan the QR code displayed on the ATM.
4. Authorize Payment: Your UPI app will prompt you to authorize the transaction for the withdrawal amount. Select the linked bank account and enter your UPI PIN.
5. Collect Cash: Once the transaction is authorized, the ATM will dispense the cash.
6. Receive Confirmation: You will receive a transaction confirmation on your UPI app and a receipt from the ATM.

The Interoperable Card-less Cash Withdrawal (ICCW) mechanism offers several advantages:

• Enhanced Security: By eliminating the need for physical cards, ICCW reduces the risk of card-related frauds, such as skimming and cloning. The use of single-use dynamic QR codes further mitigates risks.
• Accessibility: The ICCW facility is available across all banks and ATM networks that support UPI, making it widely accessible. It is particularly useful for customers who have recently opened bank accounts and do not yet have physical cards.
• Convenience: UPI-ATM withdrawals allow cash withdrawals without a physical card, providing a convenient solution for situations where a card is unavailable or lost.
• Multiple Account Withdrawals: Unlike ATM card withdrawals that deduct money from a single linked account, UPI-ATM withdrawals allow users to choose from multiple linked bank accounts.

Users can withdraw up to Rs 10,000 per transaction via ICCW, which is part of the existing daily UPI limit and subject to individual bank limits.

The Reserve Bank of India (RBI) permits ICCW transactions, encompassing both cardless cash withdrawals and UPI-ATM withdrawals. Cardless withdrawals typically require initiating requests through NetBanking, adding beneficiaries, and using mobile numbers and one-time passwords. In contrast, UPI-ATM withdrawals offer an immediate and straightforward process: scanning a QR code and authorizing with a UPI PIN.

The integration of UPI with ATMs significantly enhances transaction security, reducing the risks associated with card fraud. It also decreases reliance on physical cards and encourages the adoption of digital payment methods. This move towards UPI transactions at ATMs is expected to drive greater financial inclusion, promote digital payments, and strengthen India's digital payments ecosystem.